Tags: retail | stocks | virus | economy

Wells Fargo: Rush to Suburbia Will Boost 6 Retail Stocks

Wells Fargo: Rush to Suburbia Will Boost 6 Retail Stocks

(Lonnie Paulson | Dreamstime.com)

Wednesday, 06 May 2020 09:17 AM EDT

Wells Fargo predicts the global pandemic will likely cause Americans to leave their city apartments and move to more suburban areas, setting up a handful of retailers for success.

The post-coronavirus world will see many people leaving cities and moving to the suburbs for more space and less clustering. Society will de-urbanize, “undoing a multi-year structural demographic shift towards densely-populated cities in favor of more spacious suburban and rural areas,” Wells Fargo senior analyst Zachary Fadem told clients, CNBC reported.

Home improvement companies Home Depot (HD) and Lowe’s (LOW) will be two of the biggest beneficiaries of this trend, Wells Fargo said. Tractor Supply (TSCO) will get a boost from the new trend.

“Corresponding with renewed suburban interest, vehicle ownership could take favor over mass transit and/or ride-sharing,” said Fadem. “We believe these factors could accelerate miles driven across the country (a catalyst for repair/maintenance activity), even if employees are increasingly working from home.”

Wells Fargo likes overweight-rated Autozone (AZO), O’Reilly Automotive (ORLY) and Carvana (CVNA) when owning cars come back into popularity.

Meanwhile, Sam Zell, the billionaire known for buying up troubled real estate, said the coronavirus pandemic will leave the same kind of impact on the economy and society as the Great Depression 80 years ago, with long-lasting changes in human behavior that imperil many business models.

“Too many people are anticipating a kind of V-like recovery,” Zell said in an interview with Bloomberg Television. “We’re all going to be permanently scarred by having lived through this.”

Just as the depression left behind a generation that couldn’t shake the experience of mass unemployment, hunger and desperation, the burdens this crisis has forced on society may be similarly hard to forget. Zell, 78, said it won’t be easy for people to live as they did before the “extraordinary shock” of the pandemic.

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Wells Fargo predicts the global pandemic will likely cause Americans to leave their city apartments and move to more suburban areas, setting up a handful of retailers for success.
retail, stocks, virus, economy
303
2020-17-06
Wednesday, 06 May 2020 09:17 AM
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